Thursday, 5 December 2013

"I am a firm believer that everything happens in waves and cycles. So when
I started writing my book back in 2005 I entered every financial crisis
that I could identify into a spreadsheet, starting from the beginning
of the USA, looking for a cycle, and something very dramatic stuck out
at me. I had discovered that every 30-40 years the world has an
entirely new monetary system.
From that day till now I have been telling as many people as I could
that before the end of this decade (before 2020) there will be an
emergency meeting of the G-20 finance ministers (or something like that)
to hash out a new world monetary system. It’s normal. No man made
monetary system can possibly account for all of the forces in the free
market. They get old… they develop stress cracks… then they implode.
We have had four different monetary systems in the past 100-years.
The system we are on today is the U.S. dollar standard. It is an
ageing system that is way overdue for its own demise. It is now
developing stress cracks, and will one day implode. Like I said, it’s
normal.
But what is different this time around is that the last three
transitions were baby-steps from full gold backing, to partial gold
backing, to less gold backing, to no gold backing. In each of these
transitions the system we were transitioning from had a component that
could never fail… gold. This time we will be transitioning from a
system based on something that always fails… fiat currencies. The key
component to this transition from the U.S. dollar standard to some new
standard is of course the U.S. dollar. By the time the emergency
meeting takes place the U.S. dollar will be in the final stages of the
terminal condition known as fiat failure.
But the U.S. dollar represents more than half of the value of all the
world’s currency. A dollar crisis would cast doubts on all fiat
currencies, and the cascading effect of loss of faith could cause the
rest of them to fall like dominos. The central bankers will try
everything they can think of to keep the fiat game going, but when
everything they try fails they’ll look around and say, “What worked
before.” And once again the pendulum will swing back to quality money. "